Real eState
Cariboo real estate sales stall, decline due to struggling resource industries, COVID-19 – Williams Lake Tribune
The BC Northern Real Estate Board (BCNREB) reported 753 sales with a value of $217,389,724 through the Multiple Listing Service® (MLS®) in the first quarter of 2020. This compares with 876 sales worth $257,043,507 to the end of March 2019. As of March 31st, there were 3,096 properties of all types available for purchase through the MLS® compared to 3130 at this time last year.
The first quarter of 2020 saw a persistent pullback in housing demand, as the BC forestry, mining and oil sectors continued to struggle. This led to MLS® unit sales in the region covered by the BC Northern Real Estate Board to fall by 13 per cent compared to the same time last year. Despite the pullback in demand, prices increased by one per cent due to a notable decline in active listings. At the end of the first quarter, the MLS® average price was $298,811 in the region. MLS® sales are expected to continue to decline in the second quarter of 2020 due to the economic standstill brought on by COVID-19, which will likely also lead to significant investment projects such as LNG and BC Hydro to scale back.
Read More: 53 new COVID-19 cases in B.C., four new deaths
“The COVID-19 pandemic continues to cause significant challenges to everyone in our society,” says BC Northern Real Estate Board’s new President, Shawna Kinsley. “Our members are committed to doing their part to ensure communities stay safe. Real estate is an essential service. REALTORS® are following all orders and guidance from the Public Health Authority. The Real Estate Board has recommended that no Open Houses be held during this time. REALTORS® are also modifying their practices around face-to-face meetings and showings. Sellers may now remain on the MLS® system without the need for showings and all consumers can expect more phone or virtual meetings as well as limits on showings and new showing guidelines. We ask consumers to be patient with real estate practice changes at this time. REALTORS® remain committed to serving their clients and safeguarding their communities.”
By Region:
(2019 values appear in brackets)
Cariboo Region
100 Mile House and area: A total of 66 (68) properties of all types worth $14.8 million ($16.6 million) have been sold by REALTORS® in the area since the beginning of the year. In the first three months of 2020, 17 single-family homes, 24 parcels of vacant land and nine homes on acreage changed hands. At the end of the quarter there were 373 (375) properties available for purchase through the MLS®.
Williams Lake: 58 (91) properties have sold so far this year through MLS® in the Williams Lake area. The value of these properties was $ 15.4 million ($21.4). In addition to the 29 single-family homes sold, nine homes on acreage, six manufactured homes in parks, and one manufactured home on land have changed hands in the first quarter. As of March 31st, there were 190 (207) properties listed on the MLS® in the Williams Lake area.
Quesnel: In the Quesnel area REALTORS® reported 47 (55) sales worth $8.5 million ($11.7 million) in the first three months of 2020. In addition to the 16 single-family homes that sold, nine parcels of vacant land and seven homes on acreage have sold this year. There were 161 (147) properties of all types available for purchase through MLS® in the Quesnel area as of March 31st.
Northwest Region
Prince Rupert: 47 (34) properties worth $15.4 million ($8.8 million) have sold through the MLS® so far this year. Of those 47 properties sold, 29 were single-family residential properties and six were parcels of vacant land. As of March 31st, there were 104 (169) properties of all types available for purchase through the MLS® in the Prince Rupert area.
Terrace: REALTORS® in the Terrace area sold 58 (53) properties in the first quarter of 2020. The value of these properties was $18.9 million ($16.9 million). 29 single-family homes, five manufactured homes in parks, and two manufactured homes on land have changed hands since January 1st. As of March 31st, there were 222 (192) properties of all types available for sale in the Terrace area.
Kitimat: In the first quarter of 2020, 18 (19) properties worth $6.2 million ($6.7 million) have been reported sold. Of those 18 properties, 11 were single-family homes, three were half-duplexes and two were townhouses. At the end of March there were 113 (124) properties of all types available for sale through MLS® in the Kitimat area.
Bulkley Nechako Region
Smithers: REALTORS® in the Smithers area reported 43 (44) sales with a value of $12 million ($12.6 million) to March 31st, 2020. In addition to the 23 single-family homes that sold, four parcels of vacant land, six homes on acreage, and five manufactured homes in parks changed hands this year. At the end of the first quarter there were 122 (120) properties of all types available for purchase through the MLS® in the Smithers area.
Burns Lake: Four (16) properties worth $456 thousand ($2.3 million) have changed hands since January 1st. At the end of March there were 80 (87) properties of all types available for sale through the MLS® in the Burns Lake area.
Vanderhoof: REALTORS® in the Vanderhoof area reported 19 (30) sales worth $4.4 million ($12.2 million) in the first quarter of 2020. At the end of March there were 89 (80) properties available for purchase through the MLS® in the Vanderhoof area.
Fort St. James: In the first quarter of 2020 there were 11 (9) sales worth $2.1 million ($1.9 million) in the Fort St. James area. As of March 31st, there were 54 (61) properties available on the MLS® in the area.
Northern Region
Fort St. John: In the Fort St. John area, 90 (111) properties worth $28.3 million ($35.5 million) changed hands in the first quarter of 2020. In addition to the 41 single-family homes sold, 11 half-duplexes, 9 homes on acreage, 7 manufactured homes in parks and 3 manufactured homes on land have sold since January 1st. At the end of March there were 644 (597) properties of all types available for purchase through the MLS® in the Fort St. John region.
Fort Nelson: 11 (11) properties worth $1.6 million ($919 thousand) were reported sold through the MLS® since the beginning of the year. At the end of March there were 124 (95) properties available for purchase through the MLS® in the Fort Nelson area.
Fraser Fort George Region
Mackenzie: Since January 1st 10 (12) properties worth $1.5 million ($1.4 million) have changed hands. As of March 31st, there were 56 (63) properties available for purchase through the MLS® in the Mackenzie area.
City of Prince George: 221 (257) properties of all types, worth $73.3 million ($90 million), have changed hands in the first three months of 2020 in the City of Prince George. In the western part of the City, the median price of the 34 single-family homes that have sold on MLS® was $346,000 ($327,500). In the area east of the by-pass, the 29 single-family homes that sold had a median value of $272,500 ($309,000). In the northern part of the city, commonly referred to as “the Hart”, 29 single-family homes sold with a median price of $401,250 ($370,000). In the southwestern section of the city, 37 homes have sold since January with a median price of $453,500 ($429,500). At the end of March there were 509(534) properties of all types available on the MLS® within the city limits.
The REALTOR® members of the BC Northern Real Estate Board serve the real estate needs of the communities from Fort Nelson in the north to 100 Mile House in the south, and from the Alberta border to Haida Gwaii.
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Real eState
Caution about Canada's private real estate sector abounds as valuations slow to adjust – The Globe and Mail
Valuations for Canada’s office real estate have taken longer to adjust than properties in other advanced economies.Jeff McIntosh/The Canadian Press
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As the U.S. economy has pulled meaningfully ahead of Canada’s, so too has its private commercial real estate sector, which is adjusting more positively to the post-pandemic reality.
That’s particularly evident in both countries’ privately held office property markets. While the U.S.’s is well down the path of transforming, demolishing or otherwise ridding itself of empty office space, Canada’s has practically frozen in place following a wave of markdowns in 2023. That has made valuation assessments next to impossible.
“There’s a big dichotomy, and the Canadian market so far has not corrected,” says Victor Kuntzevitsky, portfolio manager with Stonehaven Private Counsel at Wellington-Altus Private Counsel Inc. in Aurora, Ont., which holds private real estate assets in credit and equity vehicles in both Canada and the U.S.
It’s no secret that last year was a difficult period for owners of Canadian private real estate, with many pension fund managers losing money as high interest rates drove up borrowing costs, inflation increased operating costs and vacancy rates remained high or even climbed.
The Caisse de dépôt et placement du Québec saw its real estate portfolio decline 6.2 per cent in 2023. The Ontario Teachers’ Pension Plan experienced a 5.9-per-cent loss in its real estate book, while markdowns on commercial properties owned by the Ontario Municipal Employees Retirement System (OMERS) resulted in its real estate portfolio dropping by 7.2 per cent.
However, there are pockets of strength investors can look to, says Colin Lynch, managing director and head of alternative investments at TD Asset Management Inc. These include multi-family residential and open-air retail centres, as well as industrial properties, which have been steady performers following strong gains through the pandemic.
It’s a view that dovetails with other analyses of the Canadian market. BMO Global Asset Management’s latest commercial property outlook notes that the industrial and multi-family segments remain strong due to high investor demand and tight supply.
“Office remains the asset class of the greatest near-term concern and focus,” the BMO GAM report states, estimating “a timeline for a return to ‘normal’ of a least five years.”
Mr. Lynch says while that timeframe could be accurate, private real estate investors need to evaluate opportunities on a city-by-city basis.
“Every city is very different. In fact, the smaller the city, the better the office property market has generally performed because commute times are much better, so in-office presence is much higher,” he says.
He points to cities such as Winnipeg, Regina and Saskatoon, where commute times can be 10 minutes and office workers are in four days a week on average.
However, there’s also room for more bad news, with some property owners struggling to refinance expensive debt in a higher-for-longer rate environment that could force firesales for lower-quality buildings.
The U.S. and other advanced real estate markets, such as the U.K., are “quarters ahead” of where the Canadian office market is in terms of valuation adjustments, Mr. Lynch says. A major reason is much of Canada’s commercial office real estate is owned by a relatively small group of large investment funds.
“Peak to trough in the U.K., for example, declines were about 20 per cent,” he says, noting that Canada’s market hasn’t corrected to that extent, but it is catching up.
Mr. Kuntzevitsky says these private fund assets are valued based on activity.
“The U.S. market is deeper, there’s more activity within it compared to Canada,” he says. “The auditors I speak to who value these funds are saying, ‘Listen, if there’s no activity in the marketplace, we’re just making assumptions.’”
Nicolas Schulman, senior wealth advisor and portfolio manager with the Schulman Group Family Wealth Management at National Bank Financial Wealth Management in Montreal, holds private real estate funds for clients and says he’s preparing to evaluate new investments in the Canadian space later in 2024.
“We don’t think the recovery would take a full five-year window, but we do believe it’s going to take a bit more time. Our conviction is, we want to start looking at the sector toward the end of this year,” Mr. Schulman says.
Mr. Kuntzevitsky says he’s been allocating any excess cash to the U.S. market in both private and publicly listed vehicles.
“The opportunity here is that you redeem your open-ended private [real estate investment trusts (REITs) in Canada] and reallocate the money to the U.S., where the private market reflects [net asset values] based on recent activity, or you can invest in publicly listed REITs,” he says.
Still, Mr. Kuntzevitsky is watching developments closer to home for evidence the market is turning.
In February, the Canada Pension Plan Investment Board and Oxford Properties Group Inc. struck a deal to sell two downtown Vancouver office buildings for about $300-million to Germany’s Deka Group – about 14 per cent less than they were targeting.
“Hopefully, that will activate the market,” Mr. Kuntzevitsky says. “But so far, we haven’t seen that yet.”
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A large condo complex proposed in the increasingly condo-packed Yonge and Eglinton neighbourhood is planning to go much taller.
Developer Madison Group has filed plans to increase the height of its planned two-tower condo complex at 50 Eglinton Ave. W., from previously approved heights of 33 and 35 storeys, respectively, to a significantly taller plan calling for 46- and 58-storey towers.
The dual skyscrapers will rise from a podium featuring restored facades of a heritage-designed Toronto Hydro substation building.
As of 2024, plans for high-rise development at this site have been evolving for over a dozen years, first as two separate projects before being folded into one. The height sought for this site has almost doubled in the years since first proposed, and it shouldn’t come as a huge surprise for anyone tracking development in this part of the city.
Early 2024 design for 50 Eglinton West before current height increase request.
Building on a 2023 approval for towers of 33 and 35 storeys, the developer filed an updated application at the start of 2024 seeking a slight height increase to 35 and 37 storeys.
Only a few months later, the latest update submitted with city planners this April reflects the changing landscape in the surrounding midtown area, where tower heights and density allotments have skyrocketed in recent years in advance of the Eglinton Crosstown LRT.
April 2024 vision for 50 Eglinton Avenue West.
The current design from Audax Architecture is a vertical extrusion of the previous plan that maintains all details, including stepbacks and material details.
That updated design introduced in January responds to an agreement that allows the developer to incorporate office space replacement required under the neighbourhood plan to a nearby development site at 90-110 Eglinton East.
According to a letter filed with the City, “As a result of the removal of the on-site office replacement, which altered the design and size of the podium, and to improve the heritage preservation approach to the former Toronto Hydro substation building… Madison engaged Audax Architecture and Turner Fleischer Architects to reimagine the architectural style and expression of the project.”
A total of 1,206 condominium units are proposed in the current version of the plan, with over 98 per cent of the total floor space allocated to residential space. Of that total, 553 units are planned for the shorter west tower, with 653 in the taller east tower.
A sizeable retail component of over 1,300 square metres would animate the base of the complex at Duplex and Eglinton.
The complex would be served by a three-level underground parking garage housing 216 spots for residents and visitors. Most residents would be expected to make use of the Eglinton Line 1 and future Line 5 stations across the street to the southeast for longer-haul commutes.
Audax Architecture/Turner Fleischer Architects
Real estate is increasingly a tale of two markets — a luxury sector that is booming, and the rest of the market that continues to struggle with higher rates and low inventory.
Overall real estate sales fell 4% nationwide in the first quarter, according to Redfin. Yet, luxury real estate sales increased more than 2%, posting their best year-over-year gains in three years, according to Redfin.
Real estate experts and brokers chalk up the divergence to interest rates and supply. With mortgage rates now above 7% for a 30-year fixed loan, most homebuyers are finding prices out of reach. Affluent and wealthy buyers, however, are snapping up homes with cash, making them less vulnerable to high rates.
Nearly half of all luxury homes, defined by Redfin as homes in the top 5% of their metro area by value, were bought with all cash in the quarter, according to Redfin. That is the highest share in at least a decade. In Manhattan, all-cash deals hit a record 68% of all sales, according to Miller Samuel.
The flood of cash is also driving up prices at the top. Median luxury-home prices soared nearly 9% in the quarter, roughly twice the increase seen in the broader market, according to Redfin. The median price of luxury homes hit an all-time record of $1,225,000 during the period.
“People with the means to buy high-end homes are jumping in now because they feel confident prices will continue to rise,” said David Palmer, a Redfin agent in Seattle, where the median-priced luxury home sells for $2.7 million. “They’re ready to buy with more optimism and less apprehension.”
The luxury market is also benefiting from more supply of homes for sale. Since wealthy sellers are more likely to buy with cash, they are not as worried about trading out of a low-rate mortgage like most homeowners. That has freed up the upper end of listings, creating more inventory and driving more sales.
The number of luxury homes for sale jumped 13% in the first quarter, compared to a 3% decline for the rest of the housing market, according to Redfin. While overall luxury inventory remains “well below” pre-pandemic levels, the number of luxury listings that came online during the first quarter jumped 19%, the report said.
“Prices continue to increase for high-end homes, so homeowners feel it’s a good time to cash in on their equity,” Palmer said.
Still, not all luxury markets are booming, and the strongest price growth is in areas not typically known for luxury homes. According to Redfin, the market with the fastest luxury price growth was Providence, Rhode Island, with prices up 16%, followed by New Brunswick, New Jersey, where prices were up 15%. New York City saw the biggest price decline, down 10%.
When it comes to overall sales of luxury homes, Seattle posted the strongest growth of any metro area, with sales up 37%. Austin, Texas ranked second with sales up 26%, followed by San Francisco with a 24% increase.
Luxury homes sold the fastest in Seattle, with a median days on the market of nine days, followed by Oakland, California, and San Jose, California.
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